Latest in Apple legal

Image credit:

Apple wants Samsung to pay $40 per accused device, court documents reveal

Yoni Heisler, @edibleapple
March 12, 2014
Share
Tweet
Share

Sponsored Links

In just a few weeks, Apple and Samsung will begin their second large-scale patent infringement battle in the US District Court for the Northern District of California. The trial comes just weeks after top executives from each respective company were unable to reach an amicable settlement agreement via court-ordered mediation.

Earlier this week, Florian Mueller over at FOSS Patents unearthed court transcripts which help shed some light on the licensing terms Apple was and perhaps is hoping to extract from Samsung. Specifically, Apple is seeking US$40 per device from Samsung in licensing fees. As Mueller himself points out, that type of royalty rate is ridiculously high.

A damages expert will argue on Apple's behalf that, if the parties had acted reasonably and rationally in a hypothetical negotiation, Samsung would have agreed to pay $40 -- forty dollars! -- per phone or tablet sold as a total royalty for the five patents-in-suit, which relate to (but don't even fully monopolize) the phone number tapping feature, unified search, data synchronization, slide-to-unlock, and autocomplete. The theory is that Samsung would simply have raised its prices accordingly.

What's particularly interesting about Apple's proposed $40 fee is that it's higher even than previous Apple licensing proposals made to Samsung.

Back in October 2010, Apple offered Samsung a $30 licensing fee per each smartphone device and a $40 licensing fee per each tablet sold. At the time, Apple indicated that it was willing to knock off 20% off its proposed royalty rate if Samsung agreed to cross license its own patents to Apple. That would have resulted in Samsung ponying up $24 to Apple for each smartphone sold and $32 for each Android tablet sold.

Mueller further points out that the royalty rates Apple sought in the first trial included $3.10 for pinch-to-zoom, and $2.02 for both inertial scrolling and tap to zoom, representing a grand total of $7.14 for just three software patents.

Mueller adds:

Apple's royalty-type damages claim for five software patents is also far out of the ballpark of anything that has ever been claimed or rumored to be paid in this industry for entire portfolios. After Apple and Nokia settled in 2011, the highest per-unit royalty estimate I heard about (and this was just an analyst's claim, not official information) was in the $10 range -- for Nokia's huge portfolio of SEPs and non-SEPs, not for a handful of patents. Guesstimates of what various Android device makers pay to Microsoft -- again, for a portfolio license, not a five-patent license -- that have appeared in the media did not exceed $15-20 per unit, at least the ones I'm aware of. (And Microsoft has a stronger software patent portfolio than Apple.)

Like the first trial, this one is on track to get real interesting real quick.

In this article: apple legal, legal, patent, patents, samsung
All products recommended by Engadget are selected by our editorial team, independent of our parent company. Some of our stories include affiliate links. If you buy something through one of these links, we may earn an affiliate commission.
Share
Tweet
Share

Popular on Engadget

Tesla is reportedly close to making a more affordable Model Y

Tesla is reportedly close to making a more affordable Model Y

View
Amazon-owned Ring is preparing its first smart light bulb

Amazon-owned Ring is preparing its first smart light bulb

View
Disney's new AI is facial recognition for animation

Disney's new AI is facial recognition for animation

View
Instagram now asks new users for their age

Instagram now asks new users for their age

View
A $13,000 electric car will go on sale in the US by late 2020

A $13,000 electric car will go on sale in the US by late 2020

View

From around the web

Page 1Page 1ear iconeye iconFill 23text filevr